Ranganath AAGJ (CA Final Student) 07 February 2008
An Indian exporter has paid foreign commission to an agent in foreign country. Please clarify whether service tax is payable by the exporter on the said foreign commission in India.
Dayal (Gen. Manager - Indirect Taxation) 11 February 2008
Yes service tax is payable by the exporter in terms of Applicability of Service Tax under Taxation of Services ( Provided from outside India and Received in India) Rules 2006 The above rules states that "Services provided by person who has established business or fixed establishment in a country other than India and received by a person who has his place of business or fixed establishment in India, the same is deemed to be taxable and the service tax is payable by the recipient of services Therefore will fall under BAS.